Heat dome approaching corn and soybean growing regions
This week there are 5 key reports to watch that could have significant impacts on commodity markets the week of June 16, 2024. This Farms.com column tracks key events in commodity marketing impacting the agriculture industry! The series of article shares issues to watch the following week, issues that may have an impact on commodity prices in the coming weeks.
By Devin Lashley
Farms.com Risk Management Intern
1. Keep an eye on the weather across major corn and soy growing regions across the Midwest as a heat dome appears to be moving its way in. Temperatures are expected in the 90s°F.
A heat dome with temperatures above 80 degrees at night and daytime temps at 100+ degrees in the first half of July during the reproductive stage (pollination) in corn would add significant upwards pressure grain futures as it would threaten crop yields and create some fund buying.
2. Keep an eye on China as it is experiencing a record-breaking heat wave with temperatures up to 107°F, leading to droughts and possibly leading to reduced harvest for us to 30-40 percent of corn and soybean crops.
This could translate to higher imports, and a win for the U.S. export program after Brazil announced a new 20% tax on corn and soybeans which suggest the crop is not as big as everyone thinks it is. China is the largest global importer of corn and soybeans, and it could get even larger in the coming months.
3. The USDA Crop Progress Report will be released Monday, June 17th, and will likely show corn planting to be completed, as well as a vast majority of the corn and soy crop to be emerged. Crop conditions will fall 2-4% in both corn and soybeans.
4. The USDA Cattle on Feed Report comes out Friday, June 21st. It should be a friendly report that will show cattle on feed down vs. a year ago similar to last month. U.S. domestic demand remains strong offsetting softer export demand.
5.The Drought Monitor for the U.S. will be released Thursday, June 20th, and might show a slight change in trend as far as droughts and dryness are concerned. This week's drought monitor showed the complete erasure of droughts across the Midwest as the last of the major rains passed through.
With that being said, as a heat dome approaches the eastern part of the U.S. it's likely we may see minor droughts reappearing in the medium term.
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